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Ratings agency makes more cuts; AMLO calls it punishment for ‘neoliberal policies’

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Coca-Cola Femsa was among the firms whose credit outlooks were cut.
Coca-Cola Femsa was among the firms whose credit outlooks were cut.

President López Obrador today called Standard & Poor’s downgrading of the credit rating outlook for Mexico, Pemex and the Federal Electricity Commission (CFE) punishment for “neoliberal polices” implemented by previous governments.

The ratings agency yesterday lowered the outlook to negative from stable for the state oil company, the CFE and a range of Mexican companies and financial institutions. On Friday, S&P did the same for Mexico’s sovereign credit rating.

“What I believe is that they [S&P] are punishing the country for the neoliberal policies that were applied in the last 36 years, which were a categorical failure, especially in recent years and to be more precise last year when we had nothing to do with the government,” the president said at his morning press conference.

“In the case of Mexico, neoliberalism is a synonym for corruption, for theft,” López Obrador added, charging that Pemex and the CFE were “the most looted companies not just in Mexico but in the whole world during the neoliberal period” and that his administration has been left “to pay for the broken plates.”

The president accused S&P and other ratings agencies of remaining silent the whole time when “corruption reigned.”

“The only thing I can reproach, respectfully, is that all this time while Pemex and the Federal Electricity Commission were overrun by corruption, the rating agencies said nothing,” López Obrador said.

The president’s attack on the agencies comes just over a month after he unleashed a similar barrage of criticism in the wake of Fitch Ratings’ downgrading of Pemex’s credit rating to just above junk status.

S&P said yesterday that the government’s US $5.5-billion rescue package for Pemex falls short of the funding it requires while on Friday it said that there is a one-in-three chance of a downgrade in Mexico’s credit rating during the coming year.

Among the companies that saw the outlook for their credit rating revised to negative from stable were Coca-Cola Femsa – the world’s largest Coke bottler, telecommunications giant América Movil, retailer Liverpool, two highway infrastructure companies and seven insurance companies.

The revised outlook for Coca-Cola Femsa and América Movil reflects their exposure to the government’s financial vulnerabilities, S&P said.

Telecommunications and beverage firms are “moderately sensitive to country risk,” the agency explained, adding that if it were to lower Mexico’s sovereign rating, it would also consider a one-notch downgrade for Coca-Cola Femsa and América Movil.

With regard to Liverpool, S&P said the company is “highly sensitive to an economic crisis” because most of its income is generated in Mexico.

Therefore, a downgrading of Mexico’s credit rating would automatically result in the same for the retailer.

Among the financial institutions whose outlook was lowered were the state-owned development banks Bancomext and National Financiera, Citibanamex, Bancomer, HSBC and Banco Inbursa, which is controlled by Mexico’s richest man, Carlos Slim.

“The rating action on the 77 Mexican financial institutions reflect the potential deterioration of the sovereign’s credit quality and the possible contagion to the local banking industry,” S&P said.

The Mexican subsidiaries of AIG, Allianz and AXA were among the seven insurance companies included in the rating agency’s downgraded outlook.

Source: El Financiero (sp), Milenio (sp) 

Indigenous woman wins Nayarit beauty pageant for the first time

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González is the first indigenous woman to be the Nayarit fair queen.
González is the first indigenous woman to be the Nayarit fair queen.

An indigenous woman has won the contest to be the queen of the Nayarit State Fair for the first time.

Yukaima González, 18, from a Wixárika community in the mountainous municipality of Guadalupe Ocotán, is a second-year in college student majoring in sports and physical culture.

In an interview with the newspaper El Universal, the young beauty pageant winner said she hoped her participation in the contest would inspire her community.

“In my community we are losing our [indigenous] language, and residents are ashamed of wearing their traditional clothing. I’m here so that they’ll feel proud of our roots and who we are.”

González impressed contest judges during a “traditional dress” round with her outfit, which sported intricate bead work and traditional Wixárika god’s eyes. She also made an impression with her proposed social project, which would provide support to Nayarit’s isolated mountain communities to open artisanal bakeries to support self-employment and community well-being.

The contest winner in traditional dress.
The contest winner in traditional dress.

She was one of 15 contestants from each of Nayarit’s districts, and one of two indigenous women who, for the first time ever, competed in this year’s contest. The second participant was Adriana Díaz López, a Cora indigenous woman from the municipality of Nayer.

In a message on Twitter, state congresswoman Julieta Mejía attributed the young women’s participation to Oaxaca actress Yalitza Aparicio’s lead role in Roma, stating that “Alfonso Cuarón transformed something and there’s no going back.”

Many others shared the congresswoman’s opinion on social media, and during her interview with El Universal, González expressed her admiration for the actress, saying she was proud to have the opportunity as well to represent her community and its culture.

She said that along with the excitement her triumph has generated, she has also received negative comments and messages, but has not let them get in the way of her goals.

“We are all entitled to our opinions, there are positive and negative messages, but I choose to focus on the positive ones because those are the ones that allow me to grow.”

González will preside as queen of the fair from March 7-31 on the grounds of the old Tepic airport.

Source: El Milenio (sp), El Diario (sp)

López Obrador says no to ‘offensive’ contrast of grand hotels and poverty

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The president in Los Cabos yesterday.
The president in Los Cabos yesterday.

Putting an end to the “offensive” contrast between luxurious hotels and poor neighborhoods in Mexico’s most popular resort cities is the aim of a new government program launched yesterday by President López Obrador.

The central objective of the Mi México Late (My Mexico Beats) program is to build much-needed infrastructure in the working-class neighborhoods of Mexico’s leading tourism destinations.

“We no longer want there to be the offensive contrast between large hotels and marginalized, impoverished neighborhoods without water services, without drainage, without anything,” López Obrador said yesterday in Los Cabos, Baja California Sur.

Among the cities that will benefit from the 8-billion-peso (US $413.7-million) urban improvement program are Los Cabos, Cancún, Acapulco and Puerto Vallarta.

Urban Development Secretary Román Meyer Falcón said that 10 northern border cities will also receive funding for infrastructure projects through the same program.

López Obrador said the government chose to launch the program in Los Cabos because of its importance to tourism in the country.

Almost 600 million pesos (US $31 million) will be allocated to infrastructure projects in the city’s neighborhoods, he said, explaining that residents will also be able to access financial support in order to obtain deeds for their properties.

The president also said that a 1-billion-peso (US $51.7-million) water desalination plant has been authorized for the area.

López Obrador pledged to return to Los Cabos in a few months to assess the progress of the Mi México Late program and other government initiatives.

“Mexico has a lot of natural resources, a lot of wealth, good people, hard-working people. What was needed, we now have: a good government,” he said.

Meanwhile, López Obrador announced today that his government is planning to launch a tidy towns contest to encourage people to take more pride in the places where they live.

“We have to take care of the cleanliness of our towns . . . no to garbage, no to dirtiness . . . [societal] transformation also implies cleanliness,” he said.

After waxing lyrical about the beauty of the bougainvillea plant, the president explained that the cleanest, best-decorated towns in Mexico will be officially recognized at an awards ceremony at the National Palace.

A public infrastructure project that each winning town needs will also probably be part of the prize package, López Obrador said.

“There are very poor towns with humble people but they’re very clean. For example, I know all the municipalities of Oaxaca and they’re very clean, they’re careful not to contaminate the water, there are signs . . . so that people don’t throw detergent and fertilizer into the streams, there are trash cans, that is also very important.”

Source: El Financiero (sp), Milenio (sp) 

More backlash against Guanajuato security operation to find oil thieves

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Vehicles burn on a Guanajuato highway.
Vehicles burn on a Guanajuato highway.

An anti-fuel theft operation in Guanajuato has once again been met by a hostile response from residents who set up fiery blockades to repel security forces.

A navy helicopter flew over Santa Rosa de Lima, a town in the municipality of Villagrán, early this morning as marines, soldiers and state police carried out an operation on the ground to combat the activities of the Santa Rosa de Lima Cartel – a gang of fuel thieves – and search for its leader.

The approach of the security forces prompted residents of Villagrán and the neighboring municipality of Juventino Rosas to set about 20 vehicles alight on several roads and highways in the area.

Among the highways affected were the Salamanca-Querétaro, the Celaya-Comonfort and the Celaya-Salvatierra. A state police car was among the vehicles set on fire, the newspaper Reforma reported.

Guanajuato security official Sophia Huett López said that as with other operations, forces were attempting to locate gang leader José Antonio “El Marro” Yépez Ortiz.

Guanajuato bought drones but they remain unused because police don't know how to operate them.
Guanajuato bought drones but they remain unused because police don’t know how to operate them.

Residents in Villagrán, a stronghold of the Santa Rosa de Lima Cartel, have clashed at least twice with security forces this year.

On February 23, a group of between 50 and 100 people – mainly women – shouted insults at soldiers and Federal Police in Santa Rosa de Lima, forcing the security forces to retreat.

In late January, residents also burned vehicles to create blockades on highways after an operation that seized thousands of liters of stolen fuel.

Two days later, a narco-banner, signed by “El Marro,” appeared in Salamanca warning President López Obrador to remove security forces from Guanajuato or innocent people would die.

Guanajuato was Mexico’s most violent state in 2018, recording 3,290 homicides.

Complicating the state’s security situation is that there is a shortage of municipal police officers, while drones and lapel cameras purchased by authorities in the capital for policing purposes haven’t been used, according to a security official.

“On the subject of drones, we don’t have trained personnel to fly this kind of equipment that was left by the past administration. It’s not only [a lack of] people who are trained, protocols are needed so that this technology is used effectively for security issues,” said Carlos Chávez, president of the municipal security commission.

The National Action Party (PAN) councilor added that the number of lapel cameras that were purchased only covers 5% of the municipal police force. He said all officers should wear one because they can help to ensure that human rights are respected and allow “irrefutable evidence” to be recorded during all police operations.

However, Chávez said that the priorities for municipal authorities were the purchase of more police vehicles and the training of new officers to bolster the force’s ranks.

Source: Reforma (sp), El Financiero (sp) 

ATMs send bank notes flying in three states; system shut down

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These were being freely dispensed by Bancomer ATMs on Sunday.
These were being freely dispensed by Bancomer ATMs on Sunday.

Bancomer ATMs in at least three states malfunctioned yesterday, sending bank notes flying and prompting the bank to shut down the service.

In one case, a man went to withdraw cash from a bank machine in Tijuana when it began dispensing 500-peso notes. But the time it had finished, it had issued 75,000 pesos’ worth, about US $3,900.

The man found a police officer and the money was turned over to the state prosecutor’s office to be returned to the bank.

In Guanajuato, an ATM located in a Bancomer branch in the historic centre of Guanajuato city also spat out 500-peso notes.

Then the same thing happened to an ATM Centro Max mall in the city of León. As a customer was withdrawing cash from one machine, another began throwing out 500-peso bills.

Private security guards later told authorities that the customer slipped some of the notes into a backpack but municipal police apprehended the man shortly after in the mall’s parking lot.

Another Bancomer machine went berserk in Xalisco, Nayarit. A customer was making a withdrawal when the machine he was using started giving away more cash than he had requested.

He reported the incident to authorities, indicating that two more people were using ATMs at the same time and seized the moment by taking some of the free money before municipal police arrived.

There have been unconfirmed reports that the bank was hacked.

Meanwhile, by 5:00pm yesterday dissatisfied customers were complaining to Bancomer because none of its ATMs were operating. The newspaper El Universal confirmed that machines throughout León were not operating, a situation that continued at least until midnight.

Source: El Universal (sp), El Sol de Nayarit (sp), NBC (en)

Sargassum strategy discussed as weed returns to Quintana Roo beaches

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sargassum
Here it comes again.

All levels of government in Quintana Roo are discussing measures to deal with sargassum after the weed began returning to some of the state’s beaches in the past week.

The brown, smelly seaweed has become a serious problem for the state, a threat to tourism and the ecology. And it’s probably not getting any better.

A researcher predicted in January that this could be another bad year.

A recent meeting headed by federal Tourism Secretary Miguel Torruco approved a plan with short and long-term measures to face the invasion. Officials say that dealing with the problem is vitally important not only because of the state economy’s dependence on tourism, but to protect coastal ecosystems from the acidic weed.

In meetings that have included politicians, business owners and scientists, a variety of strategies have been put forward to deal with the seaweed.

The mayor of the municipality in which Playa del Carmen is located said 13 projects presented in January to counteract the seaweed have been analyzed.

But Cancún hotelier José Chapur stressed that more than one company will be required to deal with a problem that extends from Punta Cancún to Tulum.

Not only that, but it will be necessary to determine which are prepared to guarantee results, because some of the previous efforts have not been successful, he said.

State authorities plan to use special boats and machinery to collect the seaweed while it is in the water, erect containment barriers and prepare to transport the the algae that has been collected.

State officials estimate that eliminating sargassum from the state’s beaches will cost at least US $41 million this year. Governor Carlos Joaquín González said the money was simply not in the state’s budget and that he was considering drawing on the natural disaster fund.

Some have suggested that the weed could be processed and used as industrial material for projects such as President López Obrador’s Maya Train.

As more of the floating algae returns to Quintana Roo’s shores, Tourism Secretary Torruco said “the management of sargassum is an issue that concerns us all. It is important to establish better control strategies every day for this environmental phenomenon.”

If conditions are right, the plant can double its mass in a 20-day period. The quantity of seaweed arriving exploded in 2014 and  has doubled since 2015.

Source: Milenio (sp), Riviera Maya News (en), Televisa (sp)

Standard & Poor’s downgrades Pemex credit rating outlook to negative

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pemex

Three days after lowering the outlook for Mexico’s credit rating to negative from stable, Standard & Poor’s did the same today for the state oil company.

The ratings agency maintained Pemex’s global investment grade rating at BBB+ but lowered its standalone credit profile to B- from BB- “owing to the continued deterioration in the profiles of business and financial risk” at the company.

In a statement, S & P said the government’s US $5.5-billion rescue package for the heavily-indebted state-run company falls short of the funding it requires.

“We consider that the financial plan to restore the credit fundamentals of the oil company is insufficient with respect to its multi-annual capital investment needs,” it said.

S & P said while it was reassured by the government’s commitment to meet all of Pemex’s financial obligations, to avoid “further deterioration” the company could require at least US $20 billion over several years.

The oil company has debt of US $107 billion and several large repayments to meet this year while battling to reverse output declines that have plagued it for a decade and a half.

In January, Fitch Ratings cut its rating of Pemex to just one notch above junk and speculation has since grown that Mexico’s sovereign rating could also be downgraded.

Explaining its revised outlook for Mexico’s credit rating from stable to negative, S & P said Friday that there was a one-in-three chance of a downgrade over the coming year.

Moody’s Investor Service has also said that its outlook for Mexico is under severe pressure because of debt and problems at Pemex.

Source: El Economista (sp), Financial Times (en), Reuters (en) 

Marines blamed for disappearance of 4 people in Puebla

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Friday's blockade on the Mexico City-Puebla highway.
Friday's blockade on the Mexico City-Puebla highway.

The navy says it is collaborating with civilian authorities who are investigating the disappearance of four people in Tlahuapan, Puebla, whose bodies were found Friday in nearby Nanacamilpa, Tlaxcala.

Naval officials said marines encountered a group of people taking fuel from a Pemex pipeline but failed to follow regulations.

“According to preliminary inquiries, the performance of the naval personnel was contrary to legal regulations,” said the navy in a statement, advising that the personnel involved are in custody.

Tlahuapan residents accuse marines of the forced disappearance of four of the people arrested for stealing fuel.

Residents mounted a blockade in protest on Friday on the busy highway between the state capital and Mexico City.

The victims were two adults and two youths.

Source: Milenio (sp)

Malinalco: small-town charm and a unique archaeological site

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The Cuauhcalli temple at Malinalco.
The Cuauhcalli temple at Malinalco.

I’m on my 385th step to the top of the Malinalco archaeological site and while my lungs are protesting, it’s easy to see why the original settlers, and afterwards the Mexica Indians, decided this was a good place for a lookout.

The entire green valley is spread out before me on all sides and even though the early inhabitants’ thinking was more strategic than scenic, the view is delightful.

Located in the México state town of Malinalco, this archaeological site is peculiar for its rock-cut architecture (only found here and in places like Petra, Jordan, and Ellora, India) and I attest to its uniqueness. The Cuauhcalli temple or House of the Eagles was built right into the side of the hill, with intricate forms cut around its entrance and giant eagle-head stone seats inside.

While you aren’t allowed to enter the inner sanctum, there is a replica in town at the Dr. Luis Mario Schneider University Museum if you want to get a better feel for the place. The entire complex was used as a training ground for the Mexica, where they would battle to the death with captured prisoners and be initiated as eagle warriors, their septum pierced through to announce their new status.

Four hundred and twenty-seven steps lead up to the site, a fact proudly pointed out to me twice by the single employee at the visitors’ center below — a hundred or so just to the entrance. During a weekday, with tourist crowds dispersed, you weave and wander along alleyways in town to get there, feeling quite like Alice in Wonderland, wondering what might be coming next.

Another view of the Mexica temple.
Another view of the Mexica temple.

Malinalco is not a place shouted about in international guidebooks, but most Mexico City residents know it as a rural respite just a few hundred miles from the city limits. Unlike towns similarly close – Valle de Bravo, Cuernavaca, Avandaro – Malinalco has not lost its small-town charm. Despite a handful of good restaurants and a few antique shops and galleries, the town is mainly residential, sunbaked under the heat of the central Mexico sunshine.

For travelers who need lots of in-town activities you will only last a few days, but for folks who like to sit on the plaza, have an ice cream and people watch, you might find yourself looking at property by the end of the day. That said, if you plan right you can make Malinalco a mellow base from which to explore lots of nearby nature.

The Obraje waterfalls (Cascadas del Obraje) are about an hour from town in the Parque Ecoturístico Cienega de San Antonio which is way off the map. If you go on your own a good GPS and some direction-asking Spanish are a must, but there are also local tour groups that take groups, including Maliemociones which will set you up with rappel gear for a misty descent.

There are also nearby biking and hiking trails and once you get tired of all the physical exertion, the Ruta de Mezcal (Mezcal Route), a project hoping to encourage mezcal making (and drinking) in this area.

For this we suggest you go with a guide because the route is not well developed enough yet to be easy on your own. You’re also not too far from the monarch butterfly reserve in México and Michoacán states.

If you want to stick to the sidewalk, Malinalco has some lovely churches, including its most impressive — an Augustine monastery built in 1540.

Malinalco's Augustine monastery.
Malinalco’s Augustine monastery.

At the time of this writing there are several churches closed due to 2017 earthquake damage, but enough are open that you can get your fill: see the Capilla de la Soledad, Capilla de San Pedro, Capilla de Santa Mónica, and Capilla de Santa María.

Every day at the south end of the main plaza a handful of street food stands and market vendors set up, but Wednesday is the big market day with a double row of stands along the plaza’s east side.

The area is famous for nieves (fruit ice cream with a water base), cecina (a type of dried, salted beef used for tacos and other dishes), and trout and other freshwater fish from the dozens of rivers and streams leading into the valley.

Los Placeres restaurant and the Puente de Mali are two of the better restaurants downtown and there is also the French-inspired chef’s menu-only restaurant at Hotel Casa Limon. For a more relaxed ambiance the La Casa de Valentina has a thousand and one items and an adorable patio, and the Tzolkin Café, a coffee shop right on the square, has good vegetarian food, coffee from Veracruz and local craft beer.

There several nice hotels in town, but it’s really more an Airbnb kind of place. Lots of lovely homes and villas will make you feel like a rich weekender. Outside of town I’m fond of the Canto de Aves hotel, a secluded, romantic property with seven or so adobe and wood cabins, each deliciously furnished. For a clean, inexpensive option try Hotel Santa Mónica just steps from the main plaza.

The museum previously mentioned, Museo Universitario Dr. Luis Mario Schneider, was the collection of scholar and longtime Malinalco resident Luis Schneider and has a historical rundown of the area represented with old photographs, indigenous artifacts and samples of flora and fauna. It’s easy to visit in under an hour.

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I also personally recommend the Day of the Dead in Malinalco. The local cemetery overflows with families on October 31 and November 1, decorating the graves of their loved ones, and most of Malinalco’s churches have public altars.

On the 31st you can catch the Recorrido al Mictlán, a roving Day of the Dead festival where young people from each of the town’s neighborhoods make giant paper maché puppets and dance through the streets.

You’ll find that during the week many shops and restaurants are closed, but the town also has fewer tourists so it’s give and take. This is a quiet retreat kind of place and a gateway to local nature more than a hip scene, a nice place to relax for a few days or pass through on your way to or from Mexico City.

Lydia Carey is a freelance writer based in Mexico City.

Cabo clean-up: 1,000 tires and 8 vehicles among garbage in bay

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A diver swims near one of the eight vehicles at the bottom of Cabo San Lucas bay.
A diver swims near one of the eight vehicles at the bottom of Cabo San Lucas bay.

As many as 1,000 tires and eight vehicles are among tonnes of garbage lying beneath the surface of the ocean off the coast of Cabo San Lucas in Baja California Sur.

But an ambitious clean-up program is aiming to remove most of the refuse to avoid damage to the marine environment, although the cars appear likely to stay.

Hurricane Odile in 2014 and tropical storm Lidia in 2017 swept large quantities of rubbish into the Cabo San Lucas bay via the Salto Seco arroyo, including steel structures, refrigerators, stoves, gas tanks and PVC pipe.

Now, the Natural Protected Areas Commission (Conanp), in coordination with the local diving association, the municipal government and the Secretariat of the Navy (Semar), intends to remove the garbage before it degrades and contaminates the sea off the southern tip of the Baja California peninsula.

Since the middle of last month, divers have been working every Sunday to extract the unwanted objects from the seabed while authorities and volunteers have been picking up trash strewn along the shoreline.

A school of fish near a vehicle on the seabed.
A school of fish near a vehicle on the seabed.

Miguel Alighieri, a diver and president of the advisory council for the Cabo San Lucas Protected Area (APFF), told the newspaper Milenio that some garbage has already been removed but a lot more still remains.

“More than 30 divers and boats from different companies are helping us to remove what’s left from tropical storm Lidia . . . We still have a large number of tires, we estimate that there are between 500 and 1,000 still under the water,” he said.

Alighieri explained that some of the estimated eight cars lying on the seabed have become artificial reefs and most likely won’t be removed due to the difficulty of doing so, and because they don’t pose a contamination risk or a threat to boats.

“It’s probable that [removing them] won’t be necessary because they’re not at sea level, they’re [at depths of] between 10 and 30 meters . . .” he said.

María Josué Navarro Sánchez, a Conanp deputy director responsible for the Cabo San Lucas AFFF, said that clean-up efforts have so far focused on Playa Médano, the most popular beach in the resort city.

She said the objective of the operation is to get the garbage out of the water before it degrades or drifts to other parts of the bay. Navarro also highlighted the danger the trash poses to marine life.

“There are a lot of animals that confuse these particles [with food] and they can eat them . . . Pieces of plastic have been found in the digestive tracts of fish, birds and mammals,” she said.

“. . . That’s why it’s important to maintain our ecosystem clean, not so much for tourism activities but because of the collateral [environmental] damage . . .” Navarro added.

The Conanp official stressed that even if the clean-up program is successful in removing most or all of the garbage from the water, that won’t be the end of the pollution problem because people are continuing to use normally dried-up stream beds as a dump for their garbage. When there is a storm, Navarro explained, the waste is carried to the sea.

She said that authorities are working to raise awareness of the problems that are generated by the disposal of trash upstream and stressed the importance of protecting the environment of the Cabo San Lucas Protected Area because it is the “economic livelihood” of the majority of the city’s population.

Source: Milenio (sp)